Rick Alexander Explains the Relationship Between ESG & Modern Portfolio Theory

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Welcome to our ESG Paradigm Shift Series, where we examine different angles of the ESG phenomenon and its broader implications for finance and prosperity.
In this episode, Kaitlyn Allen talks with Rick Alexander, the founder of The Shareholder Commons (TSC). TSC is an organization dedicated to creating responsible ownership throughout the investing chain. Before founding TSC, Rick served as Head of Legal Policy at B Lab and spent 31 years at Morris, Nichols, Arsht & Tunnell LLP, practicing corporate law and four years as a managing partner. Rick also served as a member of the Delaware Corporation Law Council. In his work there, he was a leader in drafting and shepherding important corporate legislation, including provisions protecting shareholders from mandatory arbitration, enabling proxy access, implementing majority voting, and authorizing public benefit corporations – Delaware’s version of the benefit corporation.
Listen as Rick takes us on a journey through the history of Modern Portfolio Theory. Learn how individual corporations are being incentivized to externalize costs and why this cost externalization is born by diversified portfolio investors. How is ESG part of the solution?
Enjoy tuning in to this episode!
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Episode Resource Links
From Meta to Twitter, What Everyone Gets Wrong About ESG — And Why It Matters | Institutional Investor
The Shareholder Commons
Moving Beyond Modern Portfolio Theory by Jon Lukomnik
Benefit Corporation Law and Governance: Pursuing Profit with Purpose Rick Alexander
SustainEx Schroeder’s Report on Costs/Value
The Rise of Fiduciary Capitalism: How Institutional Investors Can Make Corporate America More Democratic by James P. Hawley
Two New Case Studies on Closing the Climate Change and AMR Engagement Gap
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